Judge: Caesars can demolish Harrah's casino in Mississippi

JACKSON, Miss. (AP) — A Chicago bankruptcy judge has blessed plans to dismantle the former casino at the shuttered Harrah's complex in Mississippi's Tunica County.

U.S. Bankruptcy Judge Benjamin Goldgar authorized the dismantling March 30. It's one facet of a massive bankruptcy case involving Caesars Entertainment Corp. and its attempt to restructure or shed almost $20 billion in debt.

It's unclear when Caesars will begin demolition or how long it will take. Alicia Draper, a permit clerk with the Tunica County Planning Commission, said Monday that Caesars has yet to seek a required permit. Spokesman Patrick Collins would only say Friday that Caesars is "proceeding with the court-approved process."

Las Vegas-based Caesars closed Harrah's in June, eliminating about 1,000 jobs at the sprawling resort that opened in 1996 as Grand Casino Tunica.

Demolition was opposed by the Clarksdale-based Yazoo-Mississippi Delta Levee Board. The board collects $3.65 million yearly from a port facility lease for the barges docked in Buck Lake, an oxbow lake of the Mississippi River about 30 miles south of Memphis, Tennessee. Bankruptcy filings listed the board as Caesars' seventh-largest unsecured creditor, with $10.5 million due on a lease running through 2017. Caesars has paid some of that money since it filed for Chapter 11 reorganization in January.

Court filings indicate Caesars is likely to use bankruptcy rules to void the lease. However, one of the three former Harrah's hotels is on levee board land, and it's unclear what would happen to the building if Caesars ended the lease.

The levee board said that after Caesars sought demolition, the board was contacted by Ravi Bendapudi, a Los Angeles lawyer who said he and business partner Wayne Bryan wanted to buy Harrah's. The potential buyer claimed Caesars was blocking the purchase because the company didn't want Bendapudi to reopen the casino and compete with nearby Caesars-owned Horseshoe Tunica and Tunica Roadhouse Hotel & Casino.

A lawyer for the levee board wrote that Caesars has "an inherent conflict of interest because dismantling the Harrah's Tunica casino would benefit the debtors' two other casinos by effectively eliminating the possibility of future casino competition on the Harrah's Tunica property."

Levee board officials could not immediately be reached for comment Monday.

Caesars said it had tried to sell Harrah's since 2012. After extended contact with Bryan, a Virginia man who's developing a resort in Panama, Caesars described him in court papers as "less than credible."

"For example, when asked to provide proof of funds, Mr. Bryan claimed to be working with who he described as a well-funded foreign national and submitted unverified documents from a non-U.S. bank purporting to hold in excess of one trillion dollars," a lawyer for Caesars wrote.

Caesars says dismantling the barges will cut expenses by more than $500,000 a month. The casino company said it can't stop paying rent as long as it needs access to levee board land to dismantle the barges. Caesars accused the levee board of dragging its feet to keep collecting $304,000 a month in rent.

The company has said it will also raise money by selling scrap and the contents of the 136,000 square-foot casino.